04.25.07

Cantwell Announces New Plan to Improve Efficiency of Nation's Outdated Power Grid

PNNL calculates savings of $50 billion to $100 billion over the next 20 years; legislation is part of senator's energy independence push

WASHINGTON, DC - Wednesday, U.S. Senator Maria Cantwell (D-WA) announced landmark legislation to accelerate and encourage the development of a new nationwide intelligent grid system. A smart grid system and broader use of new technologies will improve energy efficiency, save consumers money on electricity bills, and help in the drive for energy independence.

"We already have the tools to get more from our energy grid, but we aren't doing enough to put these tools to work for consumers," said Cantwell, a member of the Senate Energy and Natural Resources Committee. "Upgrading America's power grid will make it more efficient and dependable, and will reduce costs for consumers. With the right incentives, technology, and investment, we can transform our energy system, lead the way to new energy efficiency, and increase America's energy independence."

The current grid in United States relies on outmoded technology—much of which dates from as far back as the 1930s—that causes transmission congestion and makes the grid unreliable and inefficient. It also requires an inefficient number of power plants because utilities build additional plants to meet periods of peak demand. These "peaking plants" may operate as many as a few hours per day or as little as a few hours per year, but the construction, operation, and maintenance costs of these peaking plants is passed along to ratepayers in the form of larger power bills. Using smart technologies to spread power use more evenly and cut demand during peak times of the day will lower costs by reducing the need for power from the most expensive sources.

Reducing peak demand has the potential to save hundreds of billions of dollars in outage costs and in reduced need for expensive, inefficient power sources. Pacific Northwest National Laboratory in Tri-Cities calculates savings between $50 and $100 billion over the next 20 years.

Cantwell announced her plan in a speech to the Gridwise Alliance, a coalition of stakeholders working to improve grid efficiency. Cantwell's legislation, which she plans to introduce in the coming weeks, would save consumers money on their electric bills, make power more reliable, reduce the frequency of blackouts, and lessen the need for expensive peak power. It would also help reduce our dependence on fossil fuels by encouraging clean energy production and the use of other technologies like plug-in hybrids, and help mitigate climate change by allowing for carbon-neutral distributed generation.

Specifically, the bill would:

  • Reduce demand for energy at peak times by encouraging new technologies that put consumers in the driver's seat when it comes to making energy consumption choices
  • Beginning in 2009 and continuing for a ten-year period, require the federal government reduce its own peak demand energy use by one-percent when compared to the previous year; this reduction by the federal government will help expanded the market for smart grid technologies and encourage federal leadership in this area
  • Ensure that appliances built during the next few years are easy to retrofit with smart appliance controls once these controls are developed
  • Create tax credits linked to proven reductions in peak demand and on-peak energy consumption -Provide financial incentives for investment in smart grid technologies, including an enhanced rate of return for utilities that invest in these technologies
  • Encourage a more distributed network of clean energy technologies and empower homes and businesses to generate their own electricity
  • Establish technology neutral national standards to help electricity-related devices exchange data

To view a white paper by Cantwell on this subject, click here.